In a research note to clients, the brokerage said, "Our preference for SPGI comes down to the level of 'self-help' remaining at each division: a) Ratings: Revenue catch-up from pricing initiatives and underperforming lines (CMBS, CLO); which will all be margin-accretive, alongside lower legal & regulatory costs."
Referring to CapIQ/SNL, the analyst thinks it is in the very initial stage of revenues and margins growth. Similarly for Platts, Patnaik is impressed by the recorded mid-single-digit growth and sees significant potential, — including cash flow, PIRA and the likes — to improve its analytics offerings, which are in the nascent stage.
Finally, the brokerage believes it is a well-established fact that its indices are a bellwether, citing diversified exposure to partnerships, trading, AUMs and its entry into fixed income.
S&P Global has been delivering EPS positive surprises between 2.0 percent and 11.2 percent in the last four quarters.
The stock closed Tuesday's regular trading at $124.78 and was up 1.51 percent to $126.66 at time of writing Wednesday.
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